Average income for $1 million home?

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I actually researched income distribution last week.



7% of Irvine households were in the $200k+ category in 2002



INCOME AND BENEFITS

(IN 2002 INFLATION-ADJUSTED DOLLARS)

orange county % of total costa mesa % of total irvine % of total HB % of total

Total households 957,490 37559 47988 71584

Less than $10,000 46,545 4.9 686 1.8 154 0.3 632 0.9

$10,000 to $14,999 37,627 3.9 1,727 4.6 1,522 3.2 2,277 3.2

$15,000 to $24,999 90,394 9.4 3,966 10.6 3,015 6.3 5,413 7.6

$25,000 to $34,999 97,803 10.2 4,437 11.8 3,315 6.9 6,334 8.8

$35,000 to $49,999 141,801 14.8 6,742 18.0 5,893 12.3 10,058 14.1

$50,000 to $74,999 182,154 19.0 8,834 23.5 9,406 19.6 15,855 22.1

$75,000 to $99,999 131,964 13.8 4,887 13.0 8,169 17.0 11,507 16.1

$100,000 to $149,999 126,497 13.2 4,020 10.7 9,262 19.3 11,997 16.8

$150,000 to $199,999 54,526 5.7 1,231 3.3 3,871 8.1 3,854 5.4

$200,000 or more 48,179 5.0 1,029 2.7 3,381 7.0 3,657 5.1



Median household income (dollars) 57,830 $50,732 $72,057 $64,824

Mean household income (dollars) 76,989 $39,207 $51,144 $73,874





sorry for the lousy formatting. excel doesn't love me.
 
<blockquote>For those folks the house is nearly pointless, since you?re never around to be in it. </blockquote>
Not sure about that. I know quite a few who are on the golf course right now playing with clients (and the clients have become their friends). They can work from home and be done by 1 pm when the stockmarket closes. ;-P
 
[quote author="freedomCM" date=1211261506]I actually researched income distribution last week.



7% of Irvine households were in the $200k+ category in 2002



INCOME AND BENEFITS

(IN 2002 INFLATION-ADJUSTED DOLLARS)

orange county % of total costa mesa % of total irvine % of total HB % of total

Total households 957,490 37559 47988 71584

Less than $10,000 46,545 4.9 686 1.8 154 0.3 632 0.9

$10,000 to $14,999 37,627 3.9 1,727 4.6 1,522 3.2 2,277 3.2

$15,000 to $24,999 90,394 9.4 3,966 10.6 3,015 6.3 5,413 7.6

$25,000 to $34,999 97,803 10.2 4,437 11.8 3,315 6.9 6,334 8.8

$35,000 to $49,999 141,801 14.8 6,742 18.0 5,893 12.3 10,058 14.1

$50,000 to $74,999 182,154 19.0 8,834 23.5 9,406 19.6 15,855 22.1

$75,000 to $99,999 131,964 13.8 4,887 13.0 8,169 17.0 11,507 16.1

$100,000 to $149,999 126,497 13.2 4,020 10.7 9,262 19.3 11,997 16.8

$150,000 to $199,999 54,526 5.7 1,231 3.3 3,871 8.1 3,854 5.4

$200,000 or more 48,179 5.0 1,029 2.7 3,381 7.0 3,657 5.1



Median household income (dollars) 57,830 $50,732 $72,057 $64,824

Mean household income (dollars) 76,989 $39,207 $51,144 $73,874





sorry for the lousy formatting. excel doesn't love me.</blockquote>


Irvine contains a larger-than-normal amoutn of high income families, however, for the purposes of figuring out who will be BUYING Irvine homes, you will have to assume the majority are coming from outside of Irvine moving TOO Irvine (since people already living there will most likely be unable to sell/move quickly, if at all, due to lower price on their existing owned homes). In addition, you would have to calculate how many of those $200K + household incomes are real-estate or 1-step removed from real estate incomes. I would bet a LARGE percentage, given the city. Clip those by at least 50% to compensate for today's conditions in those fields.



Thanks!
 
[quote author="CalGal" date=1211261843]<blockquote>For those folks the house is nearly pointless, since you?re never around to be in it. </blockquote>
Not sure about that. I know quite a few who are on the golf course right now playing with clients (and the clients have become their friends). They can work from home and be done by 1 pm when the stockmarket closes. ;-P</blockquote>


I think Eva was replying to the post about if a couple are both Attorneys at a top law firm making .5M.
 
[quote author="qwerty" date=1211258101][quote author="Stuff It" date=1211248964]so what does someone need to do for a living to make 200K a year?</blockquote>


Director of SEC Reporting (CPA) at a public company = 160K and CPA at big four firm = 115K</blockquote>


Ah, I miss Q's and K's... NOT!
 
[quote author="Masterofdamoney" date=1211262297][quote author="freedomCM" date=1211261506]I actually researched income distribution last week.



7% of Irvine households were in the $200k+ category in 2002

</blockquote>


Irvine contains a larger-than-normal amoutn of high income families, however, for the purposes of figuring out who will be BUYING Irvine homes, you will have to assume the majority are coming from outside of Irvine moving TOO Irvine (since people already living there will most likely be unable to sell/move quickly, if at all, due to lower price on their existing owned homes). In addition, you would have to calculate how many of those $200K + household incomes are real-estate or 1-step removed from real estate incomes. I would bet a LARGE percentage, given the city. Clip those by at least 50% to compensate for today's conditions in those fields.



Thanks!</blockquote>


I'm not so sure that the buyers would be coming from outside Irvine. I would have guessed more intracity "move ups", no?



And this is the data from 2002, so it may be less inflated with "housing" money.



FWIW, the $200k+ rates for CM is ~3%, and for HB is ~5%. (and 5% for OC overall)
 
[quote author="ipoplaya" date=1211262564][quote author="qwerty" date=1211258101][quote author="Stuff It" date=1211248964]so what does someone need to do for a living to make 200K a year?</blockquote>


Director of SEC Reporting (CPA) at a public company = 160K and CPA at big four firm = 115K</blockquote>


Ah, I miss Q's and K's... NOT!</blockquote>


Cmon IPO - how could you not miss the Qs and the Ks, those are the fun times of the year!
 
IR2's spreadsheet clearly shows large $$$ downpayments on 1M or in my quick sorting 950K to 1050K had an average down payment of 58%, that's huge. The only "income" they needed was to qualify for a conforming loan for $417K.



When I was growing up in Monterey Park, there were number of chinese students in elementary school that had "free lunch coupons" subsidized for low income families. Back then, lunch was .75 a day. I was good friends with a set of twins and asked them why they used the subsidized coupons when they drive a huge Mercedes Benz and live in a huge house up the hill. Their parents had large sources of money overseas, but their income here in the states was minimal, allowing them to qualify for subsidized lunches. On paper, they looked rather poor, but in reality they had tons of cash but little "verifiable" income.



I suspect some this is still true in some of the gen 1.5 or 1st gen asian families, large amounts of wealth in businesses in Hong Kong, Taiwan, or wherever, but their 1040's won't reflect any of it.
 
[quote author="qwerty" date=1211263167][quote author="ipoplaya" date=1211262564][quote author="qwerty" date=1211258101][quote author="Stuff It" date=1211248964]so what does someone need to do for a living to make 200K a year?</blockquote>


Director of SEC Reporting (CPA) at a public company = 160K and CPA at big four firm = 115K</blockquote>


Ah, I miss Q's and K's... NOT!</blockquote>


Cmon IPO - how could you not miss the Qs and the Ks, those are the fun times of the year!</blockquote>


Oh, I don't miss those at all... I did a year rotation as a staff accountant in the reporting group of a large public company where I spent the first six years of my career. SEC work was so not for me. The annual report process was kind of fun though.



I do miss hanging with and partying with the auditors though. D&T;was pretty much on-site the entire year and I dated a couple of those lovely CPAs...



You SEC reporting geeks are definitely hard to come by in these parts. I have recruiters hitting me up all the time for people with SEC experience.
 
[quote author="ipoplaya" date=1211264707][quote author="qwerty" date=1211263167][quote author="ipoplaya" date=1211262564][quote author="qwerty" date=1211258101][quote author="Stuff It" date=1211248964]so what does someone need to do for a living to make 200K a year?</blockquote>


Director of SEC Reporting (CPA) at a public company = 160K and CPA at big four firm = 115K</blockquote>


Ah, I miss Q's and K's... NOT!</blockquote>


Cmon IPO - how could you not miss the Qs and the Ks, those are the fun times of the year!</blockquote>


Oh, I don't miss those at all... I did a year rotation as a staff accountant in the reporting group of a large public company where I spent the first six years of my career. SEC work was so not for me. The annual report process was kind of fun though.



I do miss hanging with and partying with the auditors though. D&T;was pretty much on-site the entire year and I dated a couple of those lovely CPAs...



You SEC reporting geeks are definitely hard to come by in these parts. I have recruiters hitting me up all the time for people with SEC experience.</blockquote>


I was a controller at an internet company before this gig, i like this role better, much more technical. The audit firms do pretty well in staffing good looking accountants. We have been lucky with the audit teams here, good eye candy. They tend to recruit a lot out of USC so it would make sense the the girls they hire are good looking.
 
<em>"The audit firms do pretty well in staffing good looking accountants. We have been lucky with the audit teams here, good eye candy. They tend to recruit a lot out of USC so it would make sense the the girls they hire are good looking."</em>



Yep, I work at a Big 4 Accounting Firm here in OC --- and I must say you have made a very astute observation there, Qwerty. That is a perk you cannot meausure on the W-2.
 
Thanks for all the comments.



So in order to get my 200K a year I need to become a pimping sales accountant for my own company?
 
[quote author="Stuff It" date=1211268518]Thanks for all the comments.



So in order to get my 200K a year I need to become a <strong>pimping sales accountant for my own company</strong>?</blockquote>


Hmmph. Not that far away from <u>my</u> job description.
 
[quote author="Stuff It" date=1211268518]Thanks for all the comments.



So in order to get my 200K a year I need to become a pimping sales accountant for my own company?</blockquote>


I think it's a pimping sales accountant for your own company that is based in Taiwan.
 
[quote author="Stuff It" date=1211268518]Thanks for all the comments.



So in order to get my 200K a year I need to become a pimping sales accountant for my own company?</blockquote>


Just go to school, work hard, and find someone else who did the same.
 
In my opinion from a financially sound point of view, you need a minimum of 300k a year of consistent, secure income to fund a million dollar home. Irrespective of interest rates you should try and limit the purchase to 3 times your gross income. 3x income would mean 333k a year. That's a buttload of money.



In my opinion from a lenders point of view, you need a BARE MINIMUM of 250k a year of consistent, secure income AND low interest rates. Also you should have relatively low consumer debt as well. This is pushing it at 4 times gross income.
 
[quote author="lendingmaestro" date=1211277842]In my opinion from a financially sound point of view, you need a minimum of 300k a year of consistent, secure income to fund a million dollar home. Irrespective of interest rates you should try and limit the purchase to 3 times your gross income. 3x income would mean 333k a year. That's a buttload of money.



In my opinion from a lenders point of view, you need a BARE MINIMUM of 250k a year of consistent, secure income AND low interest rates. Also you should have relatively low consumer debt as well. This is pushing it at 4 times gross income.</blockquote>


So lenders don't care how much you have down? Buy a $1M place, put $600K down, and you need $300K income to fund a $400K mortgage? Hogwash...
 
[quote author="ipoplaya" date=1211285060][quote author="lendingmaestro" date=1211277842]In my opinion from a financially sound point of view, you need a minimum of 300k a year of consistent, secure income to fund a million dollar home. Irrespective of interest rates you should try and limit the purchase to 3 times your gross income. 3x income would mean 333k a year. That's a buttload of money.



In my opinion from a lenders point of view, you need a BARE MINIMUM of 250k a year of consistent, secure income AND low interest rates. Also you should have relatively low consumer debt as well. This is pushing it at 4 times gross income.</blockquote>


So lenders don't care how much you have down? Buy a $1M place, put $600K down, and you need $300K income to fund a $400K mortgage? Hogwash...</blockquote>




Hogwash huh? I'm damn glad I'm not taking your financial advice. If I just suggested that paying cash for a home that is more than 3x your income is foolish, why would having a mortgage be any better? Do you have any idea how long it takes to accumulate 600k from after tax earnings for someone living in California? A long time. Granted you may have made some money from a previous sale, and have a large down payment, it doesn't make it a wise move.



A 600k down payment towards a non-performing asset is just insane, unless you have much more assets left over in reserves. It is thinking like yours that puts people into properties well beyond their means. I am sure you could afford the monthly payment on a 400k mortgage with your income over 200k a year, but that doesn't mean purchasing and over-priced 1 Million dollar house is a wise decision. Now if you have 1 million left over in cash and securities AFTER your 600k down payment, be my guest.



Making your financial decisions on what you can afford on a monthly basis is a horrible way to manage your money. It doesn't matter if you are buying a million dollar home, bugatti veyron, airplane, yacht, or collection of fine art; it's too much damn money. If someone makes 250k a year and wants to buy a Million Dollar home I'd ask them:



How much after the down payment will you have left? Have you adequately saved for retirement? Have you even begun to save for retirement? Are you married and do you have children? Do you have a whole life or variable life policy for your family? Is it supplemented with term life insurance? Have you started to fund any annuities for retirement. Have you fully funded your children's college education or do you have enough invested now to pay for it in the future? Do you have elderly parents that will need long-term care (which medicare does NOT cover.) Or will you hope Financial Freedom is still around to bail you out with a reverse mortgage? If the answer to any of these questions is no, then buying a home should be the last thing on your to do list.



The VAST majority of Americans are way underfunded for their retirement or for unforeseen contingencies. The saying used to be "A penny saved is a penny earned." Now it has become "A penny spent is a penny enjoyed." People need to seriously reconsider how they manage their money, especially in California. The world's wealthiest man owns a very modest house in Nebraska. Surprising that he's considered the world's smartest and most prudent investor.
 
very nice, maestro! this is probably the second wisest post ever made here.



the first being the one about using shrimp paste to glue shrimps together, but yours is a close second.
 
Just and FYI: I just qualified a borrower to buy a home in Riverside this morning. FHA loan. The borrowers (husband and wife) make $65,000 a year. They have almost no outstanding debt - 3 CC's with a total balance of $2000 and monthly payments of $70 combined. That is their only outstand debt obligation.



They are buying a home for $219,000, an REO property. They are doing 97% FHA purchase financing.



With their $65,000 household income, they are BARELY qualifying. And I mean they are .0045 away from the front end DTI cap. They are on the 'good' side of the line by no more than 1 human hair.



I think the median OC income is $75,000? Something to think about. :)
 
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